Lufthansa gives cautious outlook - shares slide

Lufthansa issued cautious guidance on Thursday for revenue and profitability this year as it battles rising fuel costs and strives to erase losses at budget carrier Eurowings, sending its shares down sharply.

David Pollard reports.

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Lufthansa gives cautious outlook - shares slide

Take off time at Lufthansa .... But its shares grounded on Thursday on a cautious outlook for 2019 ... And despite an upbeat look-back on 2018.

Despite enormous pressure, we achieved a result which is close to the record of the previous year, and all this in circumstances where a lot of airlines had huge difficulties." Those include a sharp rise in fuel costs ... Plus crew shortages and scheduling hiccoughs that caused summer chaos at Europe's airports.

For its part, the German flag carrier also struggled to absorb .... The takeover costs of most of low-cost carrier's Air Berlin fleet into its own subsidiary, Eurowings.

Even if ultimately, that should bolster its position.

(SOUNDBITE) (German) HEAD OF CAPITAL MARKET ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING (on LUFTHANSA RESULTS): "They can deploy their budget carrier Eurowings more and more frequently.

And what also helps is that Air Berlin no longer exists - and that Ryanair now also has cost problems. That's an opportunity to shine.

No one needs to worry about Lufthansa." Investors have been worrying.

After an 11 per cent drop in Q4 operating profit .... Revenue forecasts for the coming year are for 4-6 per cent growth - close to or in line with last year.

It's cutting costs by 650 million against higher fuel prices .... But its share price - already down 17 per cent in the last 12 months - was sinking again on the latest headlines.... By a further six per cent.